The U.K. Financial Conduct Authority has published two draft Directives relating to Brexit under the: (1) draft Collective Investment Schemes (Amendment etc.) (EU Exit) Regulations 2019; and (2) Alternative Investment Fund Managers Regulations 2013, as amended by the draft Alternative Investment Fund Managers (Amendment etc.) (EU Exit) Regulations 2019. These draft regulations will establish a Temporary Permissions Regime enabling EEA funds that currently market in the U.K. under an EEA passport to continue to do so for three years after the U.K. exits the EU.

Under the draft Alternative Investment Fund Managers (Amendment etc.) (EU Exit) Regulations 2019, EEA Alternative Investment Funds, EU Venture Capital Funds (EuVECAs) and EU Social Entrepreneurship Funds (EuSEFs) will be able to be marketed in the U.K. post-Brexit. In addition, an EEA Alternative Investment Fund Manager will be able to market a U.K. AIF in the U.K. Similarly, under the draft Collective Investment Schemes (Amendment etc.) (EU Exit) Regulations 2019, EEA Undertakings for Collective Investment in Transferable Securities that currently market in the U.K. under an EEA passport will be able to continue to access the U.K. market post-Brexit. Furthermore, an operator of an EEA UCITS within the Temporary Permissions Regime will be able to market new sub-funds in the U.K. after exit day, subject to certain conditions. The FCA will publish directions regarding this in due course.

Neither of the draft Regulations is in force. However, it is possible for notifications to be made in advance in accordance with the draft Directions and other information published by the FCA. To benefit from the Temporary Permissions Regime, operators of UCITS and managers of AIFs, EuVECAs and EuSEFs must notify the FCA between now and the end of March 28, 2019 of any relevant fund(s), and in relation to UCITS, any relevant sub-fund(s), that they want included in the Regime.

These publications are only intended to be a general discussion of the topics covered and should not be construed as legal advice. We would be pleased to provide additional details or advice about specific situations.